BREAKING: California’s Home Battery Program (SGIP) Now Useful to Homeowners

by Andrew Meyer

May 24, 2016

Energy

Besides energy industry insiders, few people are aware that California provides one of the best home battery rebate programs in the country; one that’s capable of covering most of the cost of a new home battery. That’s because there’s one big problem with this amazing program: it’s nearly impossible for regular homeowners to access it. Fortunately, a massive reform has been proposed by the California Public Utilities Commission, that will make this rebate more accessible to every day homeowners than ever before.

Background on the CA Home Battery Program

The CA home battery program, which is technically referred to as the Self-Generation Incentive Program (or SGIP), was created as a way to motivate energy consumers to use alternative energy resources to generate and store their own electricity. Since it’s inception in 2001, the state has provided about $83 million a year to subsidize the cost of installing various technologies like wind, waste-to-heat power, gas turbines, biogas, fuel cells, and advanced energy storage in California homes and businesses. In short, the program pays Californians for using certain renewable energy systems like home batteries, which help take strain off the California grid. We’re not talking about a few extra pennies, either.

The SGIP isn’t just significant as a potential way for homeowners to save money, it is vital to speeding the adoption of home energy storage and thus enabling the new model of “distributed” energy that will provide cleaner, cheaper, more reliable energy to consumers and help relieve the strain that local utilities are facing.

Unfortunately, the program has not been administered in a way that makes it accessible to individual homeowners. In fact, in it’s almost two decades of existence, only a handful of residential home battery applications have received a cash rebate. Why? The application process is complicated and convoluted, and the funds have been released once a year in a first-come, first-served stampede that has rewarded larger commercial & industrial projects rather than homeowners. Year after year, even though residential ratepayers cover half the cost of the SGIP, they have reaped only about 1% of the funds. But things are looking up.

What Happened This Year

In the annual release of funds, which happened at 8AM on February 23rd this year, dozens of companies lined up across the State to submit their applications as fast as they could in hopes of getting a slice of the $40 million in state rebates. In an unprecedented showing from the residential sector, Swell was set to submit 83 residential applications equating to just less than 5% of the total available funds. At the start buzzer, Swell attempted to submit all 83 applications within the first few seconds that the funds were available, hoping to squeak in before some of the larger eight-figure projects. Unfortunately, like all years previous, within the first few minutes, the funds were snatched up by a few industrial providers, and California homeowners came up empty handed.

However, this year, instead of staying silent, Swell joined a coalition of companies requesting a reform to the first-come, first-serve design that systematically rewards larger projects.. In addition to requesting an overhaul of the submission process, we requested that a specific portion of the funds be separated and reserved exclusively for residential applications. The CPUC’s response to this was a resounding victory for homeowners and for residential energy storage...

The Reform

Not only has the CPUC decided to dedicate a portion of the funds specifically to homeowner applications, it’s decided to make the rebate more profitable to homeowners than before. Here are the basics of the reform:

15% of the funds allocated to energy storage will be reserved for residential storage applications, totaling more than $30 million for California homeowners

Instead of being released on an annual basis, the funds will be released on an ongoing basis until the fund is depleted.

Incentives will start at $600/kWh, which will cover most of the cost of the home battery

The Upshot

California is about to enter a Golden Age for home batteries. As a regular homeowner, installing a home battery has never been more affordable and, as it stands right now, it may never be this affordable again. It’s also never been easier. Swell has made it so that for the first time, homeowners can apply for the SGIP home battery program entirely online, and just in a couple minutes. And with lithium-ion technology providers like Sonnen and LG now offering fully-loaded, plug-and-play products, the time is ripe for breaking free with a home battery.